The CPSIA and the Creation of the Database
The Consumer Product Safety Improvement Act of 2008 (the CPSIA) was the most significant federal product safety legislation enacted in more than 30 years, since the enactment of the Consumer Product Safety Act and creation of the Consumer Product Safety Commission. The purpose of both the act and the commission was to protect consumers from dangerous and defective products; the CPSIA significantly expanded the scope of the act, increased the commission's authority and funding, imposed many additional product safety restrictions on businesses, and dramatically increased available civil penalties for noncompliance with the act.
The CPSIA focused heavily on products for or related to children, including: imposing an array of new material content requirements for toys, childcare articles, and children's products generally; expanding choking hazard warning requirements to catalogs and marketing materials; adopting an industry toy standard, ASTM F963-07, as a mandatory product safety rule; establishing new test laboratory accreditation and testing standards for certain product categories; and mandating that manufacturers certify that their products comply with all applicable product safety requirements. The CPSIA also expanded reporting obligations and granted the commission greater authority over recalls and the corrective actions that go along with them.
Many of the CPSIA's new standards and requirements were phased in over time, resulting in a flurry of activity from 2008 until 2011. Seemingly lost (but not forgotten) in the shuffle was the CPSIA requirement that the commission establish a database to house reports of harm that would be "publicly available; searchable; and accessible through the Internet website of the CPSC." 15 U.S.C. § 2055A(a)(1)(A)-(C). The commission worked steadily on the database, endured the industry harangue that the database concept itself was flawed and unfair, and survived a Congressional effort to de-fund the database. After a soft launch of the database in January 2011, the formal launch of the database and publication of reports submitted to it began on March 11, 2011. Since then, as before, there has been no shortage of controversy and criticism of the database and its content.
Database Nuts and Bolts
The CPSIA required the commission to create a database to house "[r]eports of harm relating to the use of consumer products …." 15 U.S.C. § 2055A(b)(1)(A). The database was required to be accessible through the commission's website, so the commission created a link from its website, Commission.gov, to the SaferProducts.gov webpage. SaferProducts.gov is devoted entirely to the database, including a consumer portal to submit reports, a business portal for manufacturers to register and respond to reports, and a search engine.
During the soft launch period, from January 24 through March 10, 2011, reports were received and responses were solicited from manufacturers, but those reports are not included in the searchable database, and the commission will not be entering data on its own from reports it received during the soft launch or in earlier years through its pre-CPSIA process. However, there is nothing to prevent resubmission of reports from the soft launch period (or earlier) by consumers. In addition, soft launch reports are still available through Freedom of Information Act (FOIA) requests.
Who Can File a Report?
Consumers, government agencies, health care professionals, child service providers, and public safety entities can file a report for publication on SaferProducts.gov. See 15 U.S.C. § 2055A(b)(1)(A)(i)-(v). The definition of "consumer" is extremely broad and includes not just users of products, but also family members, friends, attorneys, investigators, agents and observers of use of consumer products. See Publicly Available Consumer Product Safety Information Database Final Rule, 16 C.F.R. § 1102.10(a)(1). There is no requirement that the person submitting the report have personal knowledge regarding the product in question—a source of numerous complaints from industry.
What Must Be Included in a Report?
Reports submitted for inclusion in the database need not be submitted via the web, as all forms of reports will be reviewed for inclusion, including telephone reports. To be considered for inclusion, reports must include the following information:
- Description of product
- Identity of manufacturer or private labeler
- Description of the harm related to the product's use
- Incident date, or approximate date
- Contact information for the reporting party (which will not be published)
- Category of submitter (consumer, etc.)
- Verification by the submitter that the information is true and accurate, as well as his or her consent to include the report in the database
16 C.F.R. § 1102.10(d)(1)-(8).
What Happens After a Report Is Submitted?
If a report contains all required information, the commission should transmit the report to the manufacturer within five business days. Manufacturers that have registered on SaferProducts.gov will receive notice of reports electronically. After 10 or 15 business days, depending on the fulsomeness of the report and whether a manufacturer makes a claim of material inaccuracy, the report is published on SaferProducts.gov. (Originally the report was published within 10 business days, but Pub. L. No. 112-28, 125 Stat. 273 (2011) extended the 10-day publication timeline to 15 business days when a claim of "materially inaccurate information" is made or when the report does not contain a model or serial number.) During that time period, manufacturers can comment on the report, or file a claim that it contains materially inaccurate information and should not be included in the database. After publication, manufacturers may still provide responses for inclusion in the database after the report is made public, as well as claims of material inaccuracy, even if they miss the original deadline.
If a manufacturer wants to prevent publication due to material inaccuracy, the burden is on the manufacturer to show that the information is "false or misleading" and also "so substantial and important as to affect a reasonable consumer's decision making about the product." 16
C.F.R. § 1102.26(a)(1). Some of the potentially factual information to support a finding of material inaccuracy includes: identification of the product; identification of the manufacturer (or private labeler); the nature of the harm or risk of harm associated with the product; or the date of the incident. 16 C.F.R. § 1102.26(a)(1)(i)-(iv). Manufacturers also need to be mindful of reports that are not safety related. Complaints from consumers regarding product performance, but which do not relate to any risk of harm, should not be made public.
Manufacturers' responses to database reports are also subject to claims of material inaccuracy, which also must be shown to be false or misleading, and may be aimed at: the manufacturer's description of the product; the identity of the company responsible for the product; the harm or risk of harm associated with the product; the status of an investigation by the manufacturer or the commission regarding the product; the existence of corrective action related to the product and the commission's approval of any corrective action; or whether the manufacturer has taken (or promised) any action regarding the product. 16 C.F.R. § 1102.26(a)(2)(i)-(vi). The message to manufacturers is clear—every element of a comment submitted to the database must be accurate.
If the commission makes a determination that a report or response is materially inaccurate, it must decline to publish the information in the database (or remove it, if already published), or correct the materially inaccurate information. 16 C.F.R. § 1102.26(g).
The tight timeframes and potentially limited information made available regarding the risk of harm or incident being reported make robust investigations by manufacturers difficult in many instances, leading to concerns (pre- and post-launch) that the database will simply become a repository of unsubstantiated claims that harm manufacturers' reputations and foster litigation. Concerns regarding the use of reports gleaned from the database in product liability litigation, presumably as evidence of "other similar incidents," are addressed by the commission with the following disclaimer that accompanies each report in the database: CPSC does not guarantee the accuracy, completeness, or adequacy of the contents of the Publicly Available Consumer Product Safety Information Database on SaferProducts.gov, particularly with respect to information submitted by people outside of CPSC.
It remains to be seen if this disclaimer will be effective against efforts to admit database reports based on state and federal hearsay exclusions based on public records. See, e.g., Fed. R. Evid. 803(8).
Analysis of the First Year of the Database
As of February 29, 2012, 6,568 reports had been published on the database, just short of 600 reports per month since the database went live on March 11, 2011. Not surprisingly, there have been bumps in the road, including ongoing industry criticisms and even anonymous litigation filed by an aggrieved manufacturer to prevent publication of a report. In addition to industry concerns, the Government Accountability Office (GAO) issued a mandatory study in late 2011 which covered not only its own analysis, but also identified the concerns of others.
The GAO Report
In October 2011, the GAO published a report about the SaferProducts.gov database entitled "Consumer Product Safety Commission: Action Needed to Strengthen Identification of Potentially Unsafe Products." (The CPSIA required the GAO to conduct a study within two years of the Commission's establishment of the database. See 15 U.S.C. § 2055A(e).) The GAO report leveled a single primary criticism against the database, related to the collection of numeric information for identifying products, but also cataloged other criticisms from industry representatives.
The GAO's main criticism of the database involves numeric information such as model or serial numbers, which can be helpful in identifying unsafe products. Currently, a person submitting a report is not required to include a model or serial number. Rather, submitters only need to include a phrase that is sufficient to distinguish the product as one within the Commission's jurisdiction.The GAO report stated that manufacturers felt that the required information is insufficient for identifying products and that without model or serial numbers it is often impossible to determine the version of the product involved in the incident.
August 12, 2011, the CPSIA was amended to require that the commission attempt to obtain a model or serial number or a photograph of the product from submitters who did not include such information in their original report. The GAO report noted that the commission would have difficulty determining which submitters did not include this information in their original reports because the commission's method of analysis combines numeric identifiers with text entries like product descriptions and names. The GAO stated that the commission would need to change its analysis in order to comply with the August 12, 2011 law requiring follow-up with submitters who did not include numeric information. An October 3, 2011 letter from the majority of Consumer Product Safety Commissioners indicated that the commission was taking action to better track this information.
The GAO determined that only about one-third of the reports of harm submitted contained all of the required information. See U.S. Gov't Accountability Office, GAO-12-30, Consumer Product Safety Commission: Action Needed to Strengthen Identification of Potentially Unsafe Products 7 (2011). In addition, only one-third of submitters appeared to have firsthand knowledge of the product citing harm to themselves. Id. at 9. Twenty-four percent of submitters stated the victim was their child, spouse, parent, or other relative. Id.
Industry representatives have asserted that only those with personal experience with the product should be eligible to submit a report. Additionally, manufacturers reported to the GAO that their ability to investigate reports of harm is impacted by the quality of information about the product and incident, and that only someone with firsthand knowledge can provide adequate information. Id.
Currently, a submitter does not need to include contact information to file a report. However, the GAO found that 83 percent of published reports contained the submitter's consent to allow the commission to provide contact information to manufacturers. Id. at 10. Manufacturers assert, however, that contact information should be required, rather than optional, because they need this information to investigate reported incidents adequately. Id. at 11. The commission maintains that requiring such information could have a chilling effect, and dissuade some people from submitting reports. Id.
Material inaccuracy claims and logistics also were addressed in the GAO Report. The process and standards for claiming material inaccuracy are discussed above. The GAO Report found that 67 percent of the materially inaccurate information claims were accepted by the commission. Id. at 14.
The GAO reported that industry representatives complained that the procedure for filing materially inaccurate information claims is unduly burdensome. Id. at 16. Industry representatives complained that the claim requires a high burden of proof by specifying that the misleading information must be so substantial as to affect a reasonable consumer's decision-making. Id. Additionally, the representatives complained that they need additional time to gather evidence to support these claims because 15 days is too little time to conduct an adequate investigation. Id.
Letter from Minority of Commissioners
A minority of Consumer Product Safety Commissioners wrote a letter to the GAO on October 4, 2011. In the letter, the commissioners echoed industry representatives' concerns regarding the fact that only one-third of all incidents were reported by individuals with firsthand knowledge of the incident. They were particularly concerned about entries based on reports of incidents detailed elsewhere on the Internet and stated that they had discovered reports that appeared to be verbatim copies of information previously posted on the Internet by parties other than the submitter. The minority of commissioners also echoed concerns over the fact that contact information is not required and about the process regarding materially inaccurate information claims. The commissioners stated that the lack of specifics in many cases makes this supposed safeguard trivial. They also complained that the database creates problems for licensors and licensees because it is only structured to allow one manufacturer to respond to the report. As such, when a report lists the brand name of a product and that name is being used under a license, the manufacturer is the only party permitted to respond. Finally, the minority of commissioners also questioned the usability of the new consumer database, suggesting that it was slow and often experiences outages. The GAO responded by saying it would need to conduct another study to analyze the usability issue.
Company Doe Litigation to Prevent Database Publication
Not surprisingly (although perhaps it took longer than one would have predicted), on October 17, 2011, an anonymous product manufacturer filed a lawsuit against Commissioner Inez Tenenbaum and the Commission in the United States District Court for the District of Maryland: Company Doe v. Tenenbaum, et al., No. 11-CV-2958 (D. Md. filed Oct. 17, 2011). The Company Doe lawsuit sought to prevent publication of an incident report and also seeks to seal all court files related to the case, based on a claim that losing anonymity as plaintiff would have the same effect as publishing the report. The Company Doe pleadings remain sealed, but the docket indicates that, in addition to defendants Tenenbaum and the commission, three consumer groups—Public Citizen, Consumer Federation of America, and Consumers Union—have appeared in the case as "interested parties." The Company Doe lawsuit sheds light on two interesting and intertwined issues: judicial challenges to the publication of reports in the commission's database; and the ability of manufacturers to seal court files and remain anonymous in the process.
In October 2012, the court ruled in favor of Company Doe. See Company Doe v. Tenenbaum, et al., No. 11-CV-2958 (ruling October 9, 2012). The court granted, in part, Company Doe's Motion to Seal and its Cross-Motion for Summary Judgment. Id. at 1-2. The court denied a motion to unseal the filings from the consumer groups and denied the Commission's motion for summary judgment.
The court held that the commission had "arbitrar[ily] and capricious[ly]" published the report about Company Doe. Id. at 44. The court reasoned that "the commission's decision to publish the report bears no sensible relation to the purpose the CPSIA aims to advance: to enhance the commission's capacity to disseminate information to consumers regarding unsafe products." Id. at 38 (citations omitted). Furthermore, the court found that the commission's "complete failure to discuss, let alone explain, the inconsistency between its conduct in this case and its prior conduct compels the conclusion that its conduct, beyond being arbitrary and capricious, constitutes an abuse of discretion." Id. at 46. The court found the commission's decision to publish the report "untenable" and noted that "[i]n violation of statutory and regulatory mandates, the report is misleading and fails to relate to Plaintiff's product in any sensible way." Id. at 53.
Company Doe had requested that the court seal the entire case and permit it to proceed under a pseudonym. The court determined that while "the remedy of sealing the entire case seems overbroad," it agreed "that the public has some residual interest in knowing how courts have construed the CPSIA, especially since this case marks its first legal challenge." Id. at 69. The court noted that this approach "strikes a balance between the public's abstract interest in learning of the CPSIA's interpretive fate with Plaintiff's comparably concrete interest in preserving its reputational and fiscal health." Id. at 69-70. In permitting Company Doe to proceed under a pseudonym, the court noted that it considered two factors (both of which weighed in the Plaintiff's favor): "(1) the prejudice precluding the party from proceeding pseudonymously portends to produce . . .; and (2) the risk of unfairness to the opposing party from allowing an action against it to proceed anonymously." Id. at 71 (internal citations omitted).
Love it or hate it, the database is not going away. What can we expect in the coming years? Reports will continue to pour in by the thousands, manufacturers will continue to wrestle with the content and process, more courts will weigh in on specific published reports as challenges (likely anonymous) are filed, and further judicial refinement of just how "public" litigation over the public database will occur. With the 2012 election in the books and the administration in a position to nominate two replacement commissioners, the CPSC itself will likely continue its aggressive approach to consumer product safety.
Keywords: litigation, products liability, Consumer Product Safety Commission, database, Consumer Product Safety Improvement Act, GAO report, criticism, Company Doe lawsuit